You will be surprised to know that daily income of the Forex Trading is above 5 trillion dollars. So can you get rich by trading forex? This is, in fact, the Foreign Exchange Trading that runs on predictions and the following basic steps. Hope, you are going to be a part of it, today.
What are Some Business Terms?
First of all, you need to understand the Forex Trading business terminology, i.e. Currency means money to use as a medium of exchange, such as dollars, pounds, euros, etc.
The base currency (BC) means the currency you spend or take out.
The quote currency (QC) is the one, you buy. In this business, you will sell a currency to buy another.
The exchange rate lets you know how much QC you need to spend and the BC you should buy.
The long position is a term used for your interest in purchasing the base and selling the QC, for example, you like to sell dollars in order to buy pounds.
The short position is opposite to the long position, i.e. you are interested in purchasing the QC and selling the BC.
The bid price means the rate a broker purchases the BC in place of the QC. You sell the QC at the best rate.
The ask/offer price is the rate a broker sells the BC in place of the QC. You purchase the ask price at the best rate.
The difference in the bid and ask price is called the spread.
The Pip is a measure of difference in the value of 2 currencies.
There are 2 numbers in the Forex quote, you will read, i.e. left direction for the bid price and right direction for the ask price.
How does Buying Stocks Make You Money?
Your foresightedness is very vital in the Forex Trading. You need to analyze:
Which economy is going to weaken and which will become strong soon?
The products of which country have more demand? This is because more the products in demand, more the exports. More the strong economy, more the valued currency.
The currency of a country appreciates during the election times, if the winner makes a strong fiscal policy.
The economic reports are a big source of estimating GDP, inflation and job opportunities in a country that directly affects the value of its currency.
Normally, a pip is equal to 0.0001 of a difference in value of the currency, e.g. if euro or the US dollar goes up to 1.537 from 1.536, there is an increase of 10 pips in the value of the currency.
You will calculate the profit by multiplying the pips with the exchange rate.
How do I Open a Forex Real Account?
Find an experienced broker and ensure his transparent and honest trading. If he also deals with the securities and goods, he is a great businessman.
Check his website and read his feedback reviews
Do not proceed, if his site says, “Coming soon.”
You can open a personal as well as a managed account. The former is your own, while your broker will manage the later.For opening a Forex account, the top rated 5 websites are:
What is the Best Forex Trading Strategy?
Once you start Forex Trading, keep checking the relevant tips and tricks on Google and YouTube. Deeply, make the fundamental, technical and sentiment analysis of the market and evaluate your margin. Place an order, i.e.
Market order (at the current rate)
Limit order (at a particular rate)
Stop Order (in the anticipation)